The Hindu : Tata Power, PGCIL form JV for power transmission

Online edition of India's National Newspaper
Tuesday, Jul 01, 2003

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Tata Power, PGCIL form JV for power transmission

NEW DELHI JUNE 30 . The first of its kind public-private collaboration in the power transmission sector, state-owned Power Grid Corporation of India and Tata Power Ltd. have joined hands for setting up a 1,200 km long power transmission line.

The project, costing about Rs. 1,980 crores including sub-stations, is to evacuate power from the 1,020 MW Tala hydro-electric power project in Bhutan to the eastern region. PGCIL would hold 49 per cent equity in the project and Tata Power the balance 51 per cent.

The project investment for the joint venture portion was estimated at Rs. 1,100 crores, the Chairman and Managing Director of PGCIL, R. P. Singh, told reporters here. PGCIL would have exposure to the tune of Rs. 162 crores and Tata Power would contribute Rs. 168 crores towards equity participation. The balance Rs. 770 crores would be financed by various bankers and financial institutions including IFCI, ADB and SBI, Mr. Singh said. "Banks and FIs have agreed to extend loans without any guarantee either from PGCIL, Tata Power or the Government.''

The project, slated for completion mid-2006, was likely to achieve financial closure by September, Mr. Singh said adding that "this beginning of public-private participation in power transmission should be a trend-setter for future investments.''

PGCIL had assured the collection of transmission tariff to its private partner to the extent of 51 per cent, Mr. Singh said.

About 1,200 km of 400 kV double circuit transmission lines would be constructed from Siliguri (West Bengal) through Purnea-Muzaffarpur in Bihar and Gorakhpur-Lucknow and Bareilly to Mandola in Uttar Pradesh.

The 1,020 MW Tala hydro-electric project in Bhutan is being executed by Tala Hydro Electric Project authority; the project was being funded by India, Mr. Singh said adding that 60 per cent of the project cost was in the form of grant and 40 per cent as loan. The process to select a joint venture partner with PGCIL was initiated in July 2000, Mr. Singh said.

— PTI

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